Sarkozy tackles thorny pension reform issue

French President Nicolas Sarkozy met with union leaders on Monday to discuss the potentially explosive issue of pension reform. He sought to reassure union leaders that he would not "force through" any new measure.

A crucial round of negotiations kicked off at the Elysée presidential palace in Paris on Monday, with French President Nicolas Sarkozy and union leaders tackling the thorny issue of labour reform.

The president sought to allay fears that the government would attempt to force through speedy reforms through parliament. He said lawmakers would take the time to “consider all the options” and “consult all parties involved” before a bill is proposed “early next fall.”

“A forced reform is out of the question", he told the audience gathered at the Elysée Palace, although he warned against putting off far reaching pension reform for too long “if we want to save the pension system as we know it.”

To reduce the ballooning shortfall in France’s national pensions, Sarkozy’s government is considering two highly unpopular solutions: increasing the number of years workers must contribute to the national pension plan from the current level of 41 years, and raising the legal retirement age of 60. Recent polls show that more than half the French population is opposed to the first option, while nearly 6 out of 10 oppose the second.

Sarkozy, who in the past has ruled out rising employers and workers’ social security contributions, also indicated that he would veto any bill that proposed lowering current pension levels.

Worker unions have vowed to ferociously resist any attempt to do away with established social benefits, and plan to stage nationwide protests after regional elections are held in March. This comes as no surprise to government officials, who have already indicated that they “anticipate” social unrest and are gearing up for it.

Left-wing cacophony

For the Sarkozy administration, the time may be right to pursue reform. The public is only too aware of the terrible strain on the Pay-As-You-Go distributive system from the country's ageing population, while opposition parties have so far failed to make alternative proposals or indeed take a unified stance.

Olivier Besancenot, leader of the far-left NPA party on Sunday called for a meeting between all left-wing parties to unite against a legal retirement age above sixty. Green party secretary Cécile Duflot responded that a meeting would be “pointless” if opposition leaders “only reject government proposals and don’t come up with any alternatives”.

“What I want to do is work with those who are coming up with ways to address the pension deficit problem without going back on established social benefits – union leaders and the workers themselves”, she told French TV station BFM on Sunday.

The Socialist government is at pains to take a coherent stance on the subject. Last January, a casual remark by Socialist party Secretary General, Martine Aubry, seemed to indicate that she found it “reasonable” to push back the legal retirement age to 61 or 62, but the outcry from the grassroots of her own party led her to quickly backtrack. On Sunday, Socialist MP, Pierre Moscovici, said his party had two no-go zones: “No loanback pensions [a company’s pension assets are used as collateral for a loan subscribed with an insurance company] and no pushing back the minimum legal age”, he told French TV station, FRANCE 5, on Sunday.